Is the Paytm jigsaw falling into place? Perhaps, at least going by the words of Vijay Shekhar Sharma, the founder of the embattled startup.

Once the poster boy of India’s startup ecosystem and the most outspoken founder, Sharma went largely silent since the Reserve Bank cracked the whip on his the Paytm Payments Bank over regulatory discrepancies last year. One of the pioneers in India’s digital payments space, Paytm has since been quietly trying to put back the pieces of the puzzle.

“We are committed to working on profitability. We have not made any profit in the last few years. I can tell you very happily that with the team and the effort in the business that we have done, we are clearly committed to delivering profit in the next quarter,” Sharma said at an event last month.

As the fintech startup goes full throttle to turn profitable, it has stepped up focus on the merchants’ side of the business, lender partnerships and regaining the UPI market share.

Over the last one month, Paytm made several announcements including partnership with RBL Bank to offer its sound box, card machines to its merchant partners, UPI-enabled trading facilities for retail investors, UPI statement downloads, deployment of QR scan machines during the Mahakumbh for merchants and traders, and integration of Perplexity-enabled AI engine for Paytm users.

Detailed queries sent to Paytm over the course of profitability remained unanswered at the time of publishing this story.

Sharma’s fintech venture One97 Communications Ltd, which runs Paytm, came under stress since the central bank almost quashed its dream of making profits in 2024 after a sombre public listing in 2021. The RBI blew the lid off compliance gaps in operations that effectively led to the suspension of the Paytm Payments Bank. The year also saw the company shutting down a few business verticals, selling out some others, and laying off employees.

The management commentary in the December 2025 quarter earnings call seemed to be focussed on profitability more than ever. The company narrowed its consolidated net loss by 6% to INR 208.5 Cr in the third quarter of FY25 from INR 221.7 Cr a year back, although its revenue suffered a steep 36% decline to INR 1,827 Cr in this period.

Reading between the lines, however, shows that even though Paytm managed to reduce its indirect expenses by roughly 7.5% to INR 1,000 Cr in Q3, its direct costs grew 13% sequentially, as against a slower topline growth of 10% from INR 1,659 Cr over the previous quarter. This indicates that the revenue growth is a result of higher spending on payments processing charges, cashback and incentive costs and other direct expenses. Much of this spending has gone towards reclaiming the market share.

In fact, the 2024 RBI action on Paytm Payments Bank has set Paytm back by more than a year in terms of revenue while competition kept heating up.

The market, however, reacted to the way VSS, as the Paytm founder is referred to, painted the picture of a revival. The company’s shares traded in the black till the end of last year, though the stock took a beating after the markets turned bearish this year.

The regulatory headwinds for Paytm didn’t stop with the RBI whip. The company came under the glare of the Securities and Exchange Board of India (SEBI) and the Enforcement Directorate (ED) in quick succession over regulatory lapses. This, too, weighed on the battered stock this year.

While laying out the blueprint for profitability, Sharma reiterated........

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